Someone’s really milking it.
Milk alternatives such as soy, almond and oat milk are about the same price as dairy, according to a new report from researchers who say they should be substantially cheaper. The Star was given an advance copy of the report which will be released later this week.
“Milk prices have gone up significantly the last six months, and we were at parity. So my expectation was to see the alternatives be at least 15-20 per cent cheaper than milk by now,” said report author Sylvain Charlebois, director of the Agri-Foods Analytics Lab at Dalhousie University.
Charlebois, who worked with BetterCart Analytics on the report, looked at prices of two litres of milk and milk substitutes at stores across the country between January and June of this year, and found both are averaging close to $5. The study included Loblaws, Empire/Sobeys, Metro, Walmart, and Save-on-Foods stores.
While the retail price of milk increased by 25 per cent between January and June, the price for non-dairy alternatives rose by 31 per cent, the study found. In seven of 10 provinces, the study found that the alternatives are slightly more expensive than dairy milk. In Ontario, Quebec and P.E.I., the alternative milks are slightly cheaper.
The glass-half-full interpretation, says Charlebois, is that alternative milks aren’t much more expensive than the dairy kind, and in some cases are a bit cheaper. The glass-half-empty version? They should be substantially cheaper.
“The good news is that consumers actually have a choice, financially. Both options are basically priced the same. Dairy alternatives are competitive. But we were expecting them to be even more competitive by now, given what’s been happening with dairy,” said Charlebois.
In late June, the Canadian Dairy Commission (CDC) recommended a 2.5 per cent increase in the wholesale “farm gate” price of milk supplied to dairy processing companies, including those making cheese, yogurt and butter. The price increase, which is scheduled to take effect Sept. 1, will be the second one this year brought in after requests from dairy farmers. In a press release announcing the increase, the CDC said that feed, energy and fertilizer costs for dairy farmers have risen dramatically since August, 2021.
While energy and fertilizer costs have also gone up for producers of milk alternatives, it’s not clear that’s why their prices have kept up with dairy milk, Charlebois added.
“The dairy alternative market is not as regulated, so you’d think that prices would have actually become more affordable for consumers relative to milk, but that hasn’t happened yet,” Charlebois said.
That extra charge for using oat milk or soy milk in your latte at the coffee shop? It should be a thing of the past, Charlebois added.
“The case to charge more for alternatives in the restaurant business is getting much weaker,” said Charlebois.
At Starbucks stores in Canada, customers get charged an extra 80 cents if they want their drinks made with non-dairy milk.
While defending the charge, a Starbucks spokesperson said nothing is set in stone.
“We are always evaluating price on a product-by-product and market-by-market basis, while working to offer products that are priced in line with the broader industry that also meet our high quality standards that customers expect at Starbucks,” the spokesperson said in a written statement.
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